Department of Labour Strategic Plan 2012 briefing

NCOP Communications and Public Enterprise

29 February 2012
Chairperson: Ms M Themba (ANC, Mpumalanga)

Meeting Summary

Department of Labour briefed Members on its strategic plan for 2012. It sought a labour market that was conducive for investment, economic growth, employment creation and decent work. In order to attain such an environment, a sustainable economy was needed. To this end the Department would introduce appropriate legislation, regulations, inspection, compliance monitoring and enforcement to advance the protection of human rights and provide employment services. Issues of equity were to be promoted across racial lines and especially among women and the young people and the disabled. Social and income protection would be dealt with through the Department's and social dialogue would also be promoted.
Key aspects for the Department's the strategic plan 2011/12 included implementation of the Work Country Programme rebuilding the Public Employment Services of South Africa to maintain a database of job seekers and job opportunities. The Department of Labour inspectorate would also be strengthened.
Workers would be reintegrated into the labour market and sheltered employment factories would be restructured. Challenges included the mismatch of skills. The Training Lay–off Scheme guidelines had been revised to increase the uptake or participation of companies. Also the Unemployment Insurance Scheme signed a funding agreement. Another strategic objective was to protect vulnerable workers through inclusive economic growth. Civil society needed to be strengthened, and the target was to fund organisations involved in the world of work. Among the Department's inspection activities, inspections were to be conducted in industries identified as exposing workers to silica dust. Promoting sound labour relations was another strategic objective. To protect the vulnerable workers, the Department would ensure that the percentage of workplaces inspected and audited would comply with labour legislation within 90 days of inspection. A fully functional performance management system would be implemented to monitor the impact of legislation. The Department was to improve service quality and access by reduced waiting time at service points. The Department summarised its budget vote.

Members approved of the Budget as long as the money would be well utilised. They asked about industries, such as fishing, which had not been mentioned in the strategic plan, what programmes had been put in place by the Department to educate the people in rural areas, what was meant by a safer and better South Africa,  about job creation, and what was being done to control the influx of foreigners.

 

Full minutes

Department of Labour Strategic Plan 2012 briefing
Mr Nkosinathi Nhleko, Director-General, Department of Labour, said that the Department's mandate  was to strive for a labour market that was conducive for investment, economic growth, employment creation and decent work. In order to attain such an environment, a sustainable economy was needed and to achieve a sustainable economy there would be appropriate legislation, regulations, inspection, compliance monitoring and enforcement, which would in turn advance the protection of human rights on one hand and on the other, provide provision of employment services to the South Africans.

The regulation of the system and appropriate legislation would also require that issues of equity be promoted across racial lines and more so among women and the young people and the disabled. More so, the issue of social and income protection would be dealt with the different agencies within the Department, and, finally, social dialogue would also be promoted as it was viewed as a unique feature among the South African people and economy.

The Department reflected on its contribution to the three year strategy from April to December 2012 of the Medium Term Strategic Framework (MTSF) 2011/16, with a focus on the Government service delivery outcomes such as decent employment through inclusive economic growth, creating a better South Africa, contributing to a better, safer Africa and the World, and, more so, an efficient, effective and development oriented public service and an empowered and inclusive citizenship.

Key aspects for the Department's the strategic plan 2011/12 and goals included implementation of the Decent Work Country Programme (DWCP), and rebuilding the Public Employment Services of South Africa so as to enable Government to maintain a database of job seekers and job opportunities as well as match and place job seekers. The Department of Labour inspectorate would also be strengthened and this would address the vulnerability in the labour market through effective monitoring and legislation compliance.

Workers would be reintegrated into the labour market and sheltered employment factories would be restructured through the strengthened social security. The institutional capacity of the Department would also be strengthened

Ms Caroline Mutloane, Chief Operations Officer, Department of Labour, presented the targets and performance to date of the Department. As to the Public Employment Services of South Africa, the  Employment Services (ES) Bill had been approved and the regulations developed. However, what remained to be held was discussion by the stake holders.

The Department’s target was to register 50% job seekers on to the system and to assess and profile them within 60 days of registration, but by the third quarter, the job seekers registered on the system were 403 482 and a total of 139 428 were profiled. More so throughout the country the Department needed to register, place and refer opportunities to 450 000 job seekers, but the progress showed that 64 798 job seekers had been referred or placed into opportunities.

The performance was hence very low and she noted that among the challenges faced was the mismatch of skills but people were referred to the Department of Higher Education and Training and other skills training opportunities to try and upgrade themselves so that they could be matched to the system.

On the target of decent employment through inclusive economic growth, the strategic objective was to contribute to employment creation. The target for the number of applications from companies in distressed sectors was 30 applications to be processed within 30 working days. However, 14 applications had been received so far and processed within 30 working days. The target for the number of workers in companies in distressed sectors that were to be provided with assistance was 9,000 workers, but only 1 344 workers so far, had been assisted.

A 30% increase in sales of goods from service products that would lead to more employment of people with disabilities was the Department’s target however; sales had only increased by 15.43% during the third quarter from October to November 2011, hence R12  682 417. No additional factory workers were employed and there would be a 22% increase year on year. 100 000 youth, 50 000 women, and 1 000 People With Disabilities (PWD) were to be targeted and placed in training groups and income generating opportunities, but progress actually showed that 19 197 youth, 11 276 women and 527 PWD had been helped.

600 learners with disabilities were to be targeted and recruited to the Small Enterprise Foundation (SEF) Centre of Excellence pilot project for the year 2011/12, but progress report showed none had so far been recruited. On the other hand, 3 000 Small Medium and Macro Enterprises (SMME) managers were targeted to be trained to manage matters that concerned intellectual property, but 2 074 managers, so far, had been trained. The number of jobs that would be saved through social plan intervention was targeted to be at 20,000, but so 4,816 jobs had been saved.

70% of the mandated social responsibility investment was to be invested by March 2012 but the progress report showed that a R2 billion five year private placement bond had been issued by the Industrial Development Cooperation (IDC) and in turn subscribed by the Unemployment Insurance Fund (UIF), hence loans to other entities for infrastructure projects and job creation initiatives. By December 2011, the second and third bonds of R1.5 billion were approved, and, by 31 December 2011, estimated jobs to be created would amount to 12 431 and an estimated 13 878 jobs would be saved. A number of workers were assisted through the Training Lay – off Scheme (TLS), and R89 843 804.62 was paid by December 2011 and it benefited 9 119 workers in 46 companies.

The TLS guidelines had been revised to increase the uptake or participation of companies. More so, the UIF signed a funding agreement to the value of R75 million with R41.9million that was paid in 2010/11 to the various training social plan funding schemes based on their withdrawal conditions. The approved policy and legal frame work for service products factories was to be finalised and all the legal provisions for the SEF establishment were contained in the Employment Services (ES) Bill that was currently at the National Economic Development and Labour Council (NEDLAC). The number of companies to be assisted to facilitate constructive dialogue between social partners, managers and workers to improve productivity per annum was targeted at 120, but the progress report showed a total of 129 companies had been assisted to facilitate constructive dialogue.

On decent employment through inclusive economic growth, the strategic objective was to promote equity in the Labour Market. The key performance indicators were as follows: The Employment Equity Act (No. 55 of 1998) (EEA) and its regulations were to be amended and the target was to promulgate them, and the progress report showed that the Government proposals on the EEA were submitted to NEDLAC.

Of the 10 000 companies to be inspected, of those that were to be designated and inspected procedurally, a total of 40 inspected were Johannesburg Stock Exchange (JSE) listed companies, 124 were designated, and 11 417 companies were inspected procedurally and a 72% compliance level was achieved. The HIV and AIDS Code and Technical assistance guidelines were also to be amended, and the progress report showed that a task team that involved the International Labour Organisation (ILO) met on 15 and 16 November 2011 to consider all comments that were received on the road shows. Changes and additions were effected and preparations were made to consult on the revised draft Code at NEDLAC.

A total of 60 companies’ income differentials were to be assessed to determine race and gender disparities in salaries, hence progress made showed information had been gathered from 15 companies on income differential assessment, 15 companies had been assessed to verify and gather additional information, and that the Department had worked so closely with Siemens to ensure that the DG Review System was operational in order to avoid further delays.

Another strategic objective was to protect vulnerable workers through inclusive economic growth. The Basic Conditions of Employment Amendment Act (No. 11 of 2002) was to be promulgated and the negotiations on the theme for dealing with compliance and enforcement had been concluded. There was to be a review of the existing sectorial determinations especially on taxi, contract cleaning, domestic, farms and forestry sectors. There was hence a research in case of Taxi, a Contract Cleaning amendment notice was published in the Gazette, domestic worker amendment notice was published in the Gazette and for the case of farming and forestry, a ministerial submission was forwarded to the Minister.

Civil society on the other hand needed to be strengthened, and the target was to fund organisations involved in the world of work. DITSELA, the Workers College Natal, the South African Labour Bulletin and Sicelukukhanya Homebased Care (KZN) were the civil society organisations that received their 2nd Tranches. A total of 130 000 workplaces were to be inspected so as to achieve an 80% compliance rate; however 59 601 routine inspections were conducted and 74% compliance was achieved. 70% labour related complaints were to be settled within 14 days at Registration Services, but 98 910 labour related complaints were received and 79 440 (80%) were settled within 14days.

Another objective was to Strengthen Social Protection through inclusive economic growth. Inspections were to be conducted in the identified industries were workers were exposed to silica dust, hence 200 workplaces, in order to reduce exposure by at least 2 % Gauteng province. 96 inspections in Gauteng, were conducted.

The Occupational Health and Safety Act (No. 85 of 1993) would be repealed through a new Occupational Health and Safety (OHS) Bill to be developed and enacted into law. However, progress showed that the relevant Government departments had been and were still being consulted during the past quarter. In order to reduce incidents in the high risk sectors of iron and steel, construction, chemical and agriculture or forestry, 20 audits per sector were to be conducted, Blitz per sector and one seminar per year; however the National Roving Team conducted 273 audits and 61 follow- ups.

On the other hand, promoting sound labour relations was another strategic objective the Department aimed at. In order to achieve this, 18 collective agreements were to be published within 60 days of receipt as a new target, however, seven collective agreements were published - two were for renewal and extension of period of operation while five were extension of collective agreements to non-parties. 90 was the target to be met by the Department to register new labour organisation taken within 90 days, but the Department dealt with 45 applications for registration of labour organisations. Hence, five were approved (four trade unions and one employer’s organisation), 37 were rejected and three were cancelled.

Another key strategic objective was to strengthen the institutional capacity of the Department. The vacancy rate was to be reduced to below 8 % by 31 March 2012, but the vacancy rate by 31 December 2011 was at 7.17%. There was a target of a 34% increase in the proportion of senior management service (SMS) positions held by women by 31 March 2012.  The proportion of positions in the Department held by people with disability was to be 3 % by 31 March 2012. By 31 December 2011, the proportion of senior management service (SMS) positions held by women was 37%; 39.8% of youth; and the proportion of positions in the Department held by people with disability was 2.6%. 90% of customer complaints were to be attended to within 14 days of receipt, and by 31 December, 5 334 calls were received and 5 225 (97%) were resolved. The service delivery points accessible in line with geographical norms and standards was work that was still being done. The compliance of service delivery norms was submitted and a report from the Department of Public Service and Administration (DPSA) was still being awaited.

Mr Phineas Mothiba, Acting Chief Information Officer at the Department of Labour, then presented the key aspects of the strategic plan 2012/13: On contribution of employment creation, the Department would be registering job seekers and profiling them into different categories, and a number of people from designated groups would be placed in training and income-generating opportunities. In order to promote equity in the labour market, the EEA and its regulations would be amended, and progress monitored and evaluated.

To protect the vulnerable workers, the Department would ensure that the percentage of workplaces inspected and audited would comply with labour legislation within 90 days of inspection. In order to promote sound labour relations, the collective agreements would be extended and labour organisation applications and cancellations would be dealt with within 90 days of receipt of request. To strengthen multilateral and bilateral relations, compliance with the International Labour Organisation (ILO)’s constitution requirements in terms of Article 19 and 22 of the ILO constitution would be adhered to.

A fully functional performance management system would be implemented to monitor the impact of legislation. In order to strengthen its institutional capacity, the Department was to improve service quality and access by reduced waiting time at service points, improved turnaround time for services rendered, reduction in distances travelled to access service points and percentage of customer complaints successfully resolved within 14 days.

Among the key challenges were that the Department did not have policy and regulatory services and that there were in adequate human and information technology (IT) resources to register and profile job seekers; there were insufficient education and skills levels of registered candidates to fill reported job opportunities; and with regard to the social plan projects, some began later than was expected due to delays in the finalised agreements.

On the promotion of equity in the labour market, a key challenge was the delays at NEDLAC in finalising the amendments to the HIV and AIDS code and Technical Assistance guidelines. As to the protection of vulnerable workers and strengthening social protection there were challenges of organisational capabilities and incompetence. There was also the lack of commitment from other countries to strengthen multilateral and bilateral relations.

Mr Nhleko then noted the expectations from the Select Committee, which included supporting the Department when it tabled the budget vote, supporting the Department on legislative amendments and in collaborative work with other Departments on a committee-to–committee basis.

Mr Bheki Maduna, Chief Financial Officer, in conclusion, summarised the budget vote before the Committee. The original budget for 2011/12 on administration, inspection and enforcement services, public employment services and labour policy and industrial relations was R1 981 458 and this was adjusted to R2 017 383. The economic classification budget was originally R1 981 458 and was adjusted to R2 017 383. Allocated funds were R1 981 458 and the additional funds received during 2011 were R2 943 and R6 482. The compensation fund due to unavoidable and unforeseeable conditions of a public servant amounted to R26500.

Discussion
Mr M Sibande (ANC, Mpumalanga) supported the increase on condition the money that would be allocated would be utilised well. He asked what programmes the Department had put in place to educate the people in the rural areas on labour issues, job creation, and also what the relationship was between the Department and the traditional leaders and whether the Department was in liaison with them too. What was the Department to do about the fishing industry? He asked the Department to elaborate on the criteria they used to approve the trade unions, as some trade unions did not represent the needs of the people. He requested for an increase in the budget on the part of the inspectorate.

Mr Nhleko answered that some of the questions were beyond the Department and what the Department would do was to just facilitate; he explained that they was a wide pool of unskilled labour in South Africa. On rural areas and workers, he agreed that it was a serious matter that was being dealt with, and that through advice centres there would be a possibility of educating people on labour issues. However he called upon NGOs and all concerned to take up the duty of educating people in rural areas particularly on their labour rights. On increasing enforcement he gave an example: if the Department had to inspect over 1 000 farms and then have to report that every farm was covered, this would not be humanly possible. The work to be considered in expansion would mostly be educational services.

Ms Mutloane said that the Department had many organisations that would be participating at the local and regional level, hence also traditional leaders would be involved too.

Mr Les Kettledas, Deputy Director-General: Labour Policy and Labour Market Programmes, Department of Labour, noted that Section 95 of the Trade Unions Act listed the requirements for the trade unions and how they were then approved. The Constitution also set out a number of requirements and who then would be eligible to be members of the trade unions. When the Department cancelled the trade unions, it was when the Department believed trade unions were not genuine. The fishing industry was a problem and an investigation would be carried out to determine if there would be a certain termination for the fishing industry.

Mr H Groenewald (DA, North West) asked what was meant by a safer and better South Africa in creation of jobs. How many shelter factories were in South Africa and how many were there, in each province? What was meant by the job seekers who were profiled and what happened after they were profiled? He asked where the Department got the money to save jobs that would otherwise be lost. What was the Department doing to help control influx of foreigners in one part of South Africa?

Mr Nhleko said that if South Africa had relatively young employment growth, there would be more room for improvement, hence making it a stable economy and a safer economy. There were 12 shelter factories in South Africa and they would need to first maintain themselves financially before they expanded. He explained that there were good products that were manufactured in the factories.

Ms Mutloane said that when people were profiled, it meant that one needed to note down what the skill, age, of the job seeker was into the Department database, so that when an employer requested such skills, the Department was able to link up the job seeker with the employer. She then answered that when a foreigner was allowed to come into the country, the Department of Home Affairs and the Department of Labour ensured that the person possessed special skills needed for the job.

She explained that the training laying off scheme was put in place by the Government to assist the companies that were sinking and that they would need to be assessed. The employer would then be relieved of paying salaries and the Government would pay the workers so that when the company picked up the employer would then be able to pay the workers.

Mr M Jacobs (ANC, Free State) asked whether the Department monitored public service. He asked whether the Department had inspectors for the domestic workers as per the Geneva resolution passed in 2011. He asked whether there were inspections in other departments. He asked what the Department had done in contributing to providing employment in their own offices.

Mr Nhleko explained that the public service was beyond the scope of the Department of Labour.

Mr Zakes Mogwatlhe, Director: Inspections and Enforcement, Department of Labour, replied to the question on domestic worker inspectors and said that there were none but that matter would be looked into in the near future. He said that there were other inspections in other departments.

The Chairperson thanked the Department for the presentation, and said that the Committee would support the budget vote. She then suggested that the Department should support the labour centres by the provision of computers. She wished the Departmental delegation a safe journey back to Pretoria.

The meeting was adjourned.